888 Phil. 279
DELOS SANTOS, J.:
On 07 June 1982, AWP filed a Complaint for Injunction with Prayer for Temporary Restraining Order (TRO) and Writ of Preliminary Injunction against SIHI to prevent the extrajudicial foreclosure of the real estate mortgage it had executed in favor of SIHI. AWP alleged that the real estate mortgage contracts were given as securities for the payment of credit accommodations in the total amount of [P]6,420,490.00. AWP asserted that by allowing it to pay the interest and related charges even after the maturity dates of the promissory notes that it had executed in favor of SIHI, the latter has expressly novated the terms and conditions stipulated in those documents. Thus, it claimed that SIHI could not foreclose the mortgaged properties based on the stipulations in the original real estate mortgage contracts and promissory notes particularly the acceleration clause which rendered due and demandable the entire loan obligation if not paid on the maturity dates. The injunction case, docketed as Civil Case No. 6518-M, was originally raffled to Branch 20 of the Regional Trial Court (RTC) of Malolos City, Bulacan.
On 09 June 1982, the RTC issued a TRO. On 10 November 1982, the RTC ordered AWP to post an injunction bond of [P]6M. The RTC then issued another Order on 17 December 1982 that restrained the foreclosure of the real estate mortgage to maintain the status quo.
In its Answer with Compulsory Counterclaim, SIHI countered that the real estate mortgage contracts over a parcel of land situated in the Municipality of Bigaa, Province of Bulacan were given as securities for the payment of credit accommodations in the total amount of [P]5,612,398.80 which obligation had been restructured several times upon the request of AWP. In addition, AWP executed Financing Agreements on 09 October 1979 and 23 January 1981, whereby AWP agreed to pay SIHI additional 12% per [annum] in case of default in the payment of the obligations on their respective maturity dates and a penalty of a minimum amount of [P]50 or 2% per month, whichever is [higher,] as liquidated damages. It added that on 05 November 1981, AWP's past due obligation was restructured and AWP negotiated a check worth [P]6,430,490.09 which would become due on 03 December 1981. AWP sought another extension of payment on its unpaid obligation for which it negotiated another check in the same amount which would fall due on 13 January 1982. It claimed that AWP's obligation as of 11 May 1982, inclusive of interest and charges was [P]6,875,682.02. It made repeated demands upon AWP to pay its overdue account but the latter failed and refused to do so. On the allegation of novation, it maintained that AWP's original obligation was not extinguished because it was restructured several times.
By way of counterclaim, SIHI prayed for damages, attorney's fees and litigation expenses.
Meanwhile, on 28 June 1983, SIHI filed a Petition for Extrajudicial Foreclosure with the Office of the Provincial Sheriff of Bulacan.
On 28 November 1983, the RTC directed the issuance of a Writ of Preliminary Injunction upon filing of an injunction bond. Ex-officio [P]rovincial [S]heriff Victorino P. Evangelista, however, still proceeded with the foreclosure sale on 29 November 1983 and sold the mortgaged properties to SIHI as [the] highest bidder for a total bid price of [P]7.SM.
On 13 December 1983, AWP filed an Omnibus Motion to cite [S]heriff Evangelista in contempt of court and to nullify the public auction sale.
On 14 February 1984, SIHI filed a Petition for Writ of Possession which was raffled to Branch 14 and docketed as LRC Case No. P-39-85. Thereafter, it was consolidated with the original complaint for Injunction initiated by AWP, Civil Case No. 6518-M.
In an Order issued on 27 February 1984, the RTC nullified the auction sale conducted by Sheriff Evangelista but denied the motion to cite [S]heriff Evangelista in contempt of court.
On 17 April 1984, the RTC issued a Writ of Preliminary Injunction in favor of AWP and ordered SIHI and the ex-officio provincial sheriff of Malolos, Bulacan to refrain from proceeding with the foreclosure sale of the mortgaged properties.
SIHI challenged the 27 February 1984 and 17 April 1984 Orders before the then Intermediate Appellate Court (IAC) which reversed the RTC. On certiorari, however, the Supreme Court reversed the IAC and upheld both the 27 February 1984 order that nullified the auction sale and the 17 April 1984 order that issued a writ of preliminary injunction.
Upon motion, AWP filed an Amended Complaint dated 23 January 1985 wherein it alleged that the real estate mortgage was null and void because what it secured was not a loan but merely an assignment of receivables. Subsequently, AWP filed a Motion to Admit Supplemental Complaint dated 23 August 1990 to implead [S]heriff Evangelista as an additional defendant and to pray for attorney's fees, actual and moral damages. The RTC dismissed the amended complaint with respect to the inclusion of [S]heriff Evangelista as a defendant. AWP filed a petition for review with the Supreme Court but the latter dismissed the petition.
On 25 January 1999, SIHI filed a motion to set the case for preĀ-trial with respect to the supplemental complaint for additional damages. AWP, on the other hand, moved to cancel the pre-trial conferences set by the RTC.
On 07 June 1999, AWP filed an Omnibus Motion and prayed for the following:"1. That the eight (8) Real Estate Mortgage(s) be declared fully paid and automatically extinguished and/or;The RTC denied AWP's omnibus motion. AWP moved for a reconsideration which was likewise denied by the RTC. AWP went to the Court via a Petition for Certiorari with a prayer for a TRO and/or a writ of preliminary injunction (SP No. 55616). On 15 February 2000, the Court issued a resolution that enjoined the RTC from deciding Civil Case No. 6518-M. The TRO was, however, lifted on 09 March 2000. Eventually, on 07 March 2008, the Court dismissed the petition for certiorari for lack of merit and affirmed the RTC's denial of AWP's omnibus motion.
2. That said eight (8) Real Estate Mortgage(s) be also declared barred by the statute of limitation(s);
3. That the seventeen (17) Comprehensive Security Agreement(s); the four AGREEMENTS also (barred) by prescription and be declared without force and effect;
4. The alleged Real Estate Mortgages be both declared null and void and also (barred) by statute of limitations;
5. And all (petitioner's) claims or cause(s) of actions be dismissed, thereafter the above entitled case be dismissed without pronouncement as to (costs)."
Consequently, records of Civil Case No. 6518-M and LRC Case No. P-39-85 were forwarded to the RTC, Branch 18, for further proceedings.[6]
WHEREFORE, in view of the foregoing findings and reasons, a JOINT JUDGMENT is hereby rendered resolving and ordering:Feeling aggrieved, AWP filed a Motion for Reconsideration[9] but it was denied by the RTC. Consequently, it appealed the Joint Decision of the RTC to the CA.[10]
1). That the ten-year prescriptive period of the mortgage action has not lapsed;
2). That AWP had defaulted in the full payment of its mortgage indebtedness to SIHI before and after the nullified foreclosure [on] November 29, 1983;
3). That the petition for extrajudicial foreclosure of real estate mortgage filed by SIHI in 1983 against AWP and the initial stage of the extrajudicial foreclosure proceedings before the November 29, 1983 foreclosure sale remain valid;
4). The lifting and setting aside of the Order of November 28, 1983 and the corresponding Writ of Preliminary Injunction;
5). The dismissal of the main action of Injunction filed by AWP;
6). Allowing SIHI to proceed with the Extrajudicial Foreclosure proceeding taking into consideration the stage when the Foreclosure Sale [on] November 29, 1983 and the Sheriff 's Certificate of Sale were nullified, in accordance with Act No. 3135, as Amended; and
7). The dismissal of SIHI's and AWP's respective claims for damages and attorney's fees against each other for lack of preponderance of evidence and proof.
No costs in both instances.
SO ORDERED.[8]
WHEREFORE, we deny the appeal of Active Wood Products Co., Inc. and we deny the appeal of Deogenes O. Rodriguez. The Joint Decision of 05 September 2016 and the Order of 28 March 2017 are hereby AFFIRMED.The CA dismissed the appeal of Rodriguez for failure to file a memorandum, pursuant to Section 1, Rule 50 of the Rules of Court.
IT IS SO ORDERED.[20]
(1) | Whether or not the CA gravely erred in admitting SIHI's Amended Memorandum; |
(2) | Whether or not the CA gravely erred in finding that SIHI's right to foreclose has not prescribed; |
(3) | Whether or not the CA gravely erred in finding that AWP's obligation to SIHI was not fully extinguished; and |
(4) | Whether or not the injunction issued in favor of AWP should be affirmed. |
[I]n a petition for review on certiorari under Rule 45, the Court is generally limited to reviewing only errors of law. Nevertheless, the Court has enumerated several exceptions to this rule, such as when: (1) the conclusion is grounded on speculations, surmises or conjectures; (2) the inference is manifestly mistaken, absurd or impossible; (3) there is grave abuse of discretion; (4) the judgment is based on misapprehension of facts; (5) the findings of fact are conflicting; (6) there is no citation of specific evidence on which the factual findings are based; (7) the findings of absence of facts are contradicted by the presence of evidence on record; (8) the findings of the CA are contrary to those of the trial court; (9) the CA manifestly overlooked certain relevant and undisputed facts that, if properly considered, would justify a different conclusion; (10) the findings of the CA are beyond the issues of the case; and (11) such findings are contrary to the admissions of both parties.[27]In this case, AWP failed to show that this case falls under any of the exceptions. Pointedly, the Court notes that the factual findings of the RTC that: (1) SIHI's action or claim has not prescribed; and (2) AWP's claim of full payment was not substantiated - were both upheld by the CA. The afore-quoted findings of fact of the RTC, as affirmed by the CA, are binding and conclusive upon this Court.
[A]n action to enforce a right arising from a mortgage should be enforced within 10 years from the time the right of action accrues; otherwise, it will be barred by prescription and the mortgage creditor will lose his rights under the mortgage. The right of action accrues when the mortgagor defaults in the payment of his obligation to the mortgagee.[33]In the instant case, it is settled that SIHI's right of action started to accrue in 1981, when AWP defaulted in paying its obligation. AWP's defaults can be gleaned from the following undisputed facts: (1) AWP paid interest and related charges even after the maturity dates; (2) the obligation had to be restructured several times upon the request of AWP; and (3) AWP sought extensions of payment on its unpaid obligation.
Access to courts is guaranteed. But there must be a limit thereto. Once a litigant's rights have been adjudicated in a valid final judgment of a competent court, he should not be granted an unbridled license to come back for another try. The prevailing party should not be harassed by subsequent suits. For, if endless litigations were to be encouraged, then unscrupulous litigants will multiply in number to the detriment of the administration of justice.WHEREFORE, the Petition for Review on Certiorari is hereby DENIED. The Decision dated January 30, 2018 and the Resolution dated June 25, 2018 of the Court of Appeals in CA-G.R. SP No. 151996 are hereby AFFIRMED.